Nick Carey

LONDON (Reuters – Global supply chain disruptions have been a constant problem over the past two years due to unforeseen events. Coronavirus and war in Ukraine combined with Brexit, Coronavirus and a containership entrapped within the Suez Canal has caused delays to deliveries of all things, including bicycles and pet food.

A growing number of established logistic firms and startups have created an industry worth multi-billion dollars that uses the most recent technology to minimize disruption.

Interos Inc. Fero Labs. KlearNow Corp. and others use artificial intelligence and other cutting edge tools to help manufacturers and customers react faster to supplier snarl ups, monitor material availability, and navigate the bureaucratic maze of cross-border trading.

According to Reuters, the new market for technology services that focus on supply chains may be worth over $20 billion per year within five years. According to Tech Research firm, more than 80 percent of all new supply chain applications in 2025 will be based on artificial intelligence or data science. Gartner (NYSE:).

Dwight Klappich (Gartner analyst) stated that the world is too complex for spreadsheets to handle some of it.

Interos was valued at over $1 billion by its most recent funding round. It is one of the fastest growing companies in this market. Arlington-based Interos claims it has identified 400 million companies worldwide and employs machine learning to monitor these businesses for corporate clients. It alerts them when there is a fire, flood or other disruption.

Prior to the arrival of Russian tanks in Ukraine, Interos had evaluated the potential impact on Ukraine. Interos stated that about 500 U.S. businesses had direct supplier relationships with Ukrainian companies. Interos discovered that about 20,000 U.S.-based firms were connected to suppliers in Ukraine, and another 100,000 U.S.-based firms had relationships with third-tier vendors. 

Jennifer Bisceglie, Chief Executive said that 700 companies approached Interos after the conflict began to assess their risk exposure to Russian and Ukrainian suppliers. The company has a product that can simulate other supply disruption scenarios such as China invading Taiwan. Customers will be able to see their risk exposure and find alternatives suppliers, she said.

According to Bisceglie, supply chain disruptions are not uncommon. Bisceglie said that supply chain disruptions are inevitable. “But, I believe we’re going get better at minimising these disruptions.”

U.S. airline Delta Air Lines Inc. (NYSE:) spends over $7 billion annually on food, catering and uniforms. One company uses Interos for tracking 600 of its primary suppliers as well as 8,000 of its total suppliers.

“We’re not expecting to avoid the next crisis,” said Heather Ostis, Delta’s supply chain chief. “But, we expect to be much more efficient and productive than our competitors when we assess the risk that occurs,” said Heather Ostis, Delta’s supply chain chief.

SHAMPOO, MEAT, STEEL, SHAMPOO

KlearNow, Santa Clara California’s platform for automating cumbersome and paper-dominated customs clearance procedures sells its product.

EED Foods, an English company based in Doncaster has made this a huge help. The company imports Czech and Slovak sweets.

Elena Ostrerova is the EED’s purchasing director. We are now busier than ever before.

Ostrerova said that the company continues to grow at 40% per year after Brexit. This is partly due to the fact that some of her competitors abandoned the difficult task of importing goods from the European Union.

She said KlearNow’s customs clearance platform keeps track of its hundreds of shipments from Central Europe, tallying totals on thousands of items, correcting mistakes on everything from country of origin to gross net weight, and providing an entry number – under which all the information about a shipment is contained – for the company hauling it to Britain.

Ostrerova explained that there is minimal human involvement, saving time and money on manual data input.

Berk Birand is the CEO at Fero Labs New York, which says that the pandemic of coronaviruses highlighted the importance of manufacturers adapting to changes in suppliers, so they can make the same products no matter where the raw material comes from.

Machine learning is used by the startup to adapt and monitor how different raw materials affect product quality. This includes varying impurities of steel, to the amount of viscosity within a surfactant (a crucial ingredient in shampoo). It then connects to plant engineers for tweaking manufacturing processes in order to maintain product consistency.

Dave DeWalt is the founder of NightDragon Venture Capital, and led Interos’ $100 million Series C financing round. He says that regulators will be more interested in supply chain risk.

DeWalt explained that “if there is a supply-chain issue that may cost you significant shareholder value, then you will have a major obligation too.” I believe this is coming soon.

To increase their marketability, major logistic companies are now using machine learning. U.S. truck fleet operator Ryder System Inc (NYSE:) Uses real-time data, as well as those from customers and partners to develop algorithms that predict traffic patterns and truck availability.

Autotech Ventures, a Silicon Valley venture capital firm has made investments in KlearNow as well as newtrul. This software aggregates data from America’s fragmented trucking industry to forecast pricing changes.

Burak Cendek, Autotech partner said that “Mapping and connecting your supply chains at each part level is the Holy Grail.”